Friday, 11 April, 2025
Social Protection Committee reviews Pension Bill to safeguard dignity in retirement𝐏𝐚𝐫𝐥𝐢𝐚𝐦𝐞𝐧𝐭 𝐁𝐮𝐢𝐥𝐝𝐢𝐧𝐠𝐬
The Departmental Committee on Social Protection of the National Assembly convened a meeting with the National Treasury to deliberate on the fiscal viability of the Pensions (Amendment) Bill, 2024. The Bill, sponsored by Hon. Tandaza Sawa, proposes an increase in the annual pension increment from 1.5% to 3.0%, citing the need to uplift retirees who have served the country faithfully but are currently receiving as little as KES 3,000 per month.
The Bill aims to ensure that all retirees are able to live with dignity in their retirement years, a sentiment echoed strongly by its sponsor. The committee expressed alignment with the Bill’s intent, noting the increasing financial strain faced by older citizens in today’s economy.
In its submission, the National Treasury outlined the potential economic implications of the proposed increment, referencing an actuarial valuation as instructed by the Committee last year. National Treasury presented data-driven insights that emphasized long-term fiscal sustainability, cautioning that increasing the annual adjustment to 2% alone would result in additional liabilities of approximately KES 49.2 billion by 2025.
While Treasury did not support the automatic increase proposed in the Bill, it highlighted ongoing efforts to protect retirees, including the planned exemption of pensions from taxation starting December 2025.
The Committee Chair assured stakeholders that the Committee remains devoted to pursuing a balanced solution that safeguards retirees without compromising public financial sustainability.
As part of its next steps, the Committee will prepare a comprehensive report in consultation with the actuaries conducting the current valuation, the Bill’s sponsor and representatives from the Kenya Association of Retired Officers. This will be tabled before the House.